Amazon moved in to buy the San Francisco online gathering place for video gamers after the startup's deal with Google Inc. fell through, people with knowledge of the matter said. Amazon is paying $970 million in cash. Including retention-related payouts, the transaction is worth about $1.1 billion, said one of the people, who asked not to be identified because the talks are private.

The deal, the largest in Amazon's 20-year history, gives the Web retailer an online forum of more than 55 million monthly active users, where people discuss games or watch other gamers as they play. CEO Bezos has made video games a focus of a strategy to add more entertainment services. Just as the company is beefing up its TV programming available to Amazon Prime members, the company operates a game studio in Seattle and has been luring software developers to build more video-game titles for its Fire TV set-top box, Fire Phone and Kindle Fire tablets.

"Broadcasting and watching gameplay is a global phenomenon and Twitch has built a platform that brings together tens of millions of people who watch billions of minutes of games each month," Bezos said in a statement.

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The deal also highlights the stepped up rivalry between Amazon and Google. In addition to battling for customers watching an increasing amount of video through the Internet, the two companies also are competing for business in online data storage and Internet advertising.

Google and Twitch were in talks this year on a transaction that could value Twitch at about $1 billion, a person familiar with discussions said in May. As the deal with Google was being discussed, investment banker Frank Quattrone introduced Twitch to other potential bidders, one of the people said. Sally Palmer, a spokeswoman at Quattrone's Qatalyst Partners LLC, didn't immediately return a call for comment.

Amazon is spending $100 million to produce TV shows for its Prime customers and introduced a music-streaming service this year.

Twitch is available on PlayStation 4 and Xbox One game consoles. Started about seven years ago as Justin.tv, the service has a highly engaged audience of people who watch others play video games. In February, 1 million people shared videos via Twitch. The company raised $20 million from investors last year.